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Lifescan, Inc. and Lifescan Scotland, Ltd v. Shasta Technologies

December 5, 2012

LIFESCAN, INC. AND LIFESCAN SCOTLAND, LTD., PLAINTIFFS,
v.
SHASTA TECHNOLOGIES, LLC, ET AL.,
DEFENDANTS.



ORDER GRANTING PLAINTIFFS' MOTION FOR LEAVE TO AMEND; DENYING DEFENDANTS' MOTION FOR LEAVE TO AMEND AS MOOT [Re: Docket Nos. 152, 154]

Presently before the court are Plaintiffs LifeScan, Inc. and LifeScan Scotland, Ltd.'s (collectively, "Plaintiffs") Motion for Leave to File a First Amended Complaint, and Defendants Shasta Technologies, LLC, Instacare Corp., Pharmatech Solutions, Inc., and Conductive Technologies, Inc.'s (collectively, "Defendants") Motion for Leave to File an Amended Answer.

This court has jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1338(a). Plaintiffs oppose 21 Defendants' motion, and two Defendants-Instacare Corp. and Pharamtech Solutions Inc.-oppose 22 Plaintiffs' motion. For the reasons set forth below, the court GRANTS Plaintiffs' Motion for 23 Leave, and DENIES Defendants' Motion for Leave as moot. 24

I.Background

This case is a patent infringement action concerning blood glucose test trips. Plaintiff Lifescan Scotland, Ltd. filed this action on September 9, 2011, alleging that Defendants infringe its 27 U.S. Patent Nos. 6,241,862 ("the '862 patent") and 5,708,247 ("the '247 patent"). Nearly a year 28 later, Plaintiff amended the complaint to add LifeScan, Inc. as an additional Plaintiff. Dkt. No. 2 134. At the time of filing, Defendants' product had not received FDA approval and as of this date 3 still has not received approval. Thus, Defendants do not actually have any accused product on the 4 market. This wrinkle has caused a significant amount of uncertainty in this litigation. 5

6 numerous occasions. Plaintiffs have several times indicated to Defendants and this court that they 7 have in their possession sufficient information to show that FDA approval for Defendants' product 8 is imminent, and have raised the spectre of a motion for a preliminary injunction, including at least 9 one request for a preliminary injunction hearing. See Dkt. Nos. 70, at 8-11; 87; 90; 124. As of this 10 date, more than ten months after Plaintiffs first alluded to this likelihood, FDA approval has not yet court and the parties proceeded with the litigation. After initial arguments over a possible stay of 14 discovery or stay of the case, on February 1, 2012, this court issued a scheduling order. Because of 15 a dispute as to whether Defendants complied with the Patent Local Rules relating to their invalidity 16 contentions, the court extended the deadlines of that initial scheduling order on May 9, 2012. Dkt. 17

No. 94. In the same order, this court ordered that Defendants produce to Plaintiffs, inter alia, 18 supplemental invalidity contentions and documents sufficient to show the operation of the accused 19 product. Id. Several months later, on July 19, 2012, this court denied Defendants' Motion for 20 Plaintiffs samples of the accused product and its FDA file by August 10, 2012 (Dkt. No. 107). 22 Grewal on August 24, 2012. Dkt. No. 130. Defendants nominally complied with this court's July 24 19, 2012 order, producing test strip samples by the August 10th deadline. However the samples 25 appear to have been expired. Therefore, under an agreement among counsel, Defendants produced 26 new samples on September 12, 2012 along with some additional documents. 27 28 Prior to the present motions, the parties sought changes to the court-ordered schedule on been granted and Plaintiffs have not filed for a preliminary injunction.

With the possibility of a preliminary injunction motion looming over these proceedings, the Judgment on the Pleadings and Motion for Stay (Dkt. No. 108) and ordered them to produce to 21 Defendants failed to comply with the May 9, 2012 order, and were sanctioned by Magistrate Judge 23 2 and invalidity contentions and document productions, this court again re-set the case schedule on 3

August 28, 2012. See Dkt. No. 131. In that order, the court granted both parties a generous stretch 4 of time to prepare and serve adequate amended infringement and invalidity contentions. Pointing 5 to the late production of Defendants' samples, Plaintiffs served their amended infringement 6 contentions fifteen days past the deadline set in the scheduling order. This court denied ex parte 7 motions from both parties relating to this incident, leaving the scheduling order intact. Dkt. No. 8

Complaint, seeking to add a claim of indirect infringement of U.S. Patent No. 7,250,105 ("the '105 10 patent,") and Defendants filed their Motion for Leave to File an Amended Answer, adding an affirmative defense under Section 2 of the Sherman Act, 15 U.S.C. § 2. The court now turns to the subject of these motions. 13

Leave to amend is generally granted with liberality. Fed. R. Civ. P. 15(a)(2) ("The court 15 should freely give leave when justice so requires"); Morongo Band of Mission Indians v. 16 Rose, 893 F.2d 1074, 1079 (9th Cir. 1990). Leave need not be granted, however, where the 17 amendment of the complaint would cause the opposing party undue prejudice, is sought in bad 18 faith, constitutes an exercise in futility, or creates undue delay. Foman v. Davis, 371 U.S. 178, 182 19 (1962); Janicki Logging Co. v. Mateer, 42 F.3d 561, 566 (9th Cir. 1994). Not all of the Rule 15 20 considerations are created equal; "it is the consideration of prejudice to the opposing party that 21 carries the greatest weight." Eminence Capital, LLC v. Aspeon, Inc., 316 F.3d 1048, 1052 (9th 22 Fritz Cos. Sec. Litig., 282 F. Supp. 2d 1105, 1109 (N.D. Cal. Aug. 27. 2003) (citing DCD 24 Programs Ltd. v. Leighton, 833 F.2d 183, 187 (9th Cir. 1987)). 25 opposition to Plaintiffs' motion. Accordingly, "Defendants," as used in the proceeding sections, 28 Meanwhile, because of renewed disputes about the sufficiency of the parties' infringement 151. Four days later, Plaintiffs filed the instant Motion for Leave to File a First Amended 9

II.Legal Standard

Cir. 2003). "The party opposing the amendment bears the burden of showing prejudice." In re 23

III.Discussion

Defendants Shasta Technologies, LLC and Conductive Technologies, Inc. have not filed an shall refer only to Instacare Corp. and Pharmatech Solutions, Inc.Because the court grants 2 Plaintiffs' motion, Defendants' motion is moot and the court will only address the parties' 3 arguments relating to Plaintiffs' motion. 4 deciding a motion for leave to amend. Defendants argue that a grant of leave to amend would be 7 unduly prejudicial because the amendment would make it impossible for them to comply with the 8 schedule set by this court. Defendants' invalidity contentions were due November 22, 2012, before 9 the hearing on this motion, and the exchange of claim construction terms is set to occur on 10 Were the court powerless to re-examine and adjust its order, Defendants would certainly be 14 prejudiced. However, amending the schedule to prevent prejudice to a party is well within the 15 court's ...


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